How much do mutual fund distributors make?

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SEBI norms require the Association of Mutual Funds of India (AMFI) to disclose the commissions of distributors who get more than Rs 1 crore in commission from all fund houses or more than Rs 50 lakh from a single fund house. In 2015-16, 497 distributors qualified under these criteria. In 2016-17, the list expanded to 732 distributors. In 2017-18, the list has further swelled to 979 distributors.

Collectively, these distributors manage about Rs 9.21 lakh crore which is about 40% of the total mutual fund industry AUM of about Rs 22.6 lakh crore. These distributors raked in a total fee of Rs 8,533 crore in FY 2017-18, just shy of 1% of AUM. The commission ranges from 0.5% to 2% based on the nature of the product with debt funds offering lower end of the range. The list is dominated by India’s big private banks and one large non-bank distributor. Here are the top 10 distributors.

Distributor

Commission (Rs Crore)

FY 18 AUM (Rs Crore)

FY 17 AUM (Rs Crore)

NJ India Invest Pvt Ltd

787

50,157

30,958

HDFC Bank Limited

641

63,370

45,814

State Bank of India

558

42,697

19,944

Axis Bank Limited

538

45,937

35,650

ICICI Bank Limited

470

38,262

27,964

ICICI Securities Limited

317

29,811

20,310

Kotak Mahindra Bank Limited

274

40,307

27,384

Citibank N.A

249

30,084

26,209

Prudent Corporate Advisory

218

13,997

8,122

Standard Chartered Bank

185

17,598

14,032

These top 10 distributors account for 40% of the total money managed by these 979 distributors and 50% of the total fee income earned. The higher fee income is a result of the strong bargaining power that they have with mutual funds.

The Online Distribution Space

Online distributors are growing rapidly but still have to make their presence felt in the overall distribution space. The largest of these, Funds India (fundsindia.com) managed Rs 2,587 crore in FY 2016-17. Its AUM almost doubled to Rs 4,253 crore in FY 2017-18. Scripbox (Scripbox.com) saw its AUM swell from Rs 233 crore to Rs 584 crore, a 150% growth. Wealthapp, another online player, made a debut on the list with an AUM of Rs 119 crore.